London close: Stocks end higher as traders weigh US data, Eurozone CPI

The UK equity market finished the week on a high as US data came in better than forecast and low Eurozone inflation fuelled stimulus hopes.

The University of Michigan’s forward-looking consumer confidence index rose to 92.1 in October from 87.2 the previous month, smashing expectations for reading of 89.

According to another set of figures released by the Federal Reserve, industrial output fell 0.2% from an upwardly revised 0.1% decline in the previous month and compared with analysts' expectations for a 0.3% decline.

"The decline in industrial production in September was a much smaller fall than we were expecting, but it nonetheless illustrates the impact that the stronger dollar is having on manufacturing and the impact that the slump in energy prices is having on mining output," said Paul Ashworth, chief US economist at Capital Economics.

Manufacturing output fell by a very modest 0.1% month-on-month last month and the decline in August was revised to 0.1% month-on-month from 0.4% month-on-month. Analysts had predicted a 0.2% fall.

Eurozone CPI

Eurostat’s final estimate of the Eurozone consumer price index confirmed a 0.1% year-on-year fall in September, down from August’s 0.1% rise, as energy prices continued to drag. The figures were as expected by analysts.

“With the Eurozone-wide figure expected at -0.1%, the region’s indices could see a return of the market-lifting hopes that always seem to creep in whenever any data suggests that Mario Draghi might need to dip into his ECB QE coffers for a bit of extra stimulus,” said Connor Campbell, financial analyst at Spreadex.

ECB policymaker Ewald Nowotny on Thursday said fresh measures were needed to lift inflation towards the monetary authority’s target of just below 2%. The weak inflation figures come despite the ECB’s €60m a month asset purchase programme which is due to run until at least September 2016. However, the ECB has indicated that it will consider extending the programme if the outlook for inflation worsens.

Companies

Burberry extended declines after revealing on Thursday that second quarter sales were hit by a slowdown in China.

Astrazeneca dropped as US health regulators declined to approve its fixed-dose diabetes drug combination.

Shire gained on the back of the news from AstraZeneca.

Provident Financial jumped after its third-quarter results showed the non-standard lender's UK bank continued to surpass expectations, with other businesses solid.

Interdealer broker ICAP slumped after Barclays downgraded the stock to ‘equalweight’ from ‘overweight’ and cut the price target to 500p from 600p pointing to a lack of earnings momentum.

Market Movers

FTSE 100 (UKX) 6,376.97 0.60%
FTSE 250 (MCX) 16,901.88 -0.28%
techMARK (TASX) 3,030.30 0.36%

FTSE 100 - Risers

Shire Plc (SHP) 4,510.00p 3.09%
Prudential (PRU) 1,524.50p 2.56%
Tesco (TSCO) 196.75p 2.39%
3i Group (III) 478.20p 2.18%
Whitbread (WTB) 4,691.00p 2.02%
Randgold Resources Ltd. (RRS) 4,580.00p 1.91%
Capita (CPI) 1,261.00p 1.86%
Direct Line Insurance Group (DLG) 382.40p 1.70%
Royal Dutch Shell 'A' (RDSA) 1,808.50p 1.66%
Royal Dutch Shell 'B' (RDSB) 1,833.50p 1.61%

FTSE 100 - Fallers

GKN (GKN) 270.40p -3.60%
Burberry Group (BRBY) 1,277.00p -1.92%
TUI AG Reg Shs (DI) (TUI) 1,211.00p -1.62%
Ashtead Group (AHT) 949.00p -1.61%
Royal Mail (RMG) 446.00p -1.55%
Rolls-Royce Holdings (RR.) 686.50p -1.51%
Glencore (GLEN) 116.00p -1.49%
BHP Billiton (BLT) 1,130.00p -1.31%
Smiths Group (SMIN) 1,009.00p -1.27%
Antofagasta (ANTO) 579.50p -1.19%

FTSE 250 - Risers

Provident Financial (PFG) 3,344.00p 5.22%
DCC (DCC) 5,215.00p 4.72%
Jimmy Choo (CHOO) 138.00p 2.99%
Worldwide Healthcare Trust (WWH) 1,705.00p 2.90%
Enterprise Inns (ETI) 108.20p 2.56%
Brown (N.) Group (BWNG) 357.00p 2.35%
Vedanta Resources (VED) 578.00p 2.30%
Allied Minds (ALM) 448.30p 2.14%
Bank of Georgia Holdings (BGEO) 2,007.00p 2.14%
Cable & Wireless Communications (CWC) 57.35p 1.96%

FTSE 250 - Fallers

NMC Health (NMC) 731.50p -9.97%
Bodycote (BOY) 510.50p -7.18%
Weir Group (WEIR) 1,164.00p -6.28%
Telecom Plus (TEP) 1,100.00p -5.01%
IMI (IMI) 951.00p -4.66%
Keller Group (KLR) 870.50p -4.45%
Renishaw (RSW) 1,948.00p -4.32%
Electrocomponents (ECM) 203.10p -4.29%
Morgan Advanced Materials (MGAM) 285.00p -4.07%
Ophir Energy (OPHR) 98.25p -3.77%